SINGAPORE--NTT Data, the IT services arm of Japan's NTT Group, has pegged its presence and future growth in burgeoning Myanmar to its recently-opened offshore development center, as well as opportunities to provide ICT solutions in the country's "social infrastructure" such as traffic control and monitoring in transportation.
Located in Yangoon, the offshore development center began operations on Nov. 8 and mainly supports software development projects outsourced from Japan. Soon, work from customers in foreign developed economies across Europe and the United States will be added, according to Ryoji Fukaya, Asia-Pacific president and CEO of NTT Data.
Speaking at a media conference here Thursday, Fukaya added the company's long-term strategy in Myanmar will focus on the business potential of the local market. It will work closely with both domestic companies and local offices set up by global and Asian organizations.
"Many things are changing and happening [in Myanmar], and we will closely look for opportunities," he said, highlighting the need to work with homegrown companies in order to understand local customs.
But the opportunities for NTT Data are not limited to the country's corporate sector, Fukaya said. "We are very strong in social infrastructure, providing the backoffice systems used in water supply, electronics, and transportation. [While] it depends on [the Myanmar] government, we are happy to help and support them."
Nonetheless, he acknowledged political uncertainty would be a potential challenge for NTT Data, as with any overseas companies, to establish a presence in the Myanmar market.
After decades of military rule, the country recently had been opening up to political and economic reforms as well as foreign investment, with U.S. President Barack Obama making a landmark visit last month.
Myanmar is the fourth country in Asia where NTT Data has set up offshore development sites, following cities in India, China, and Vietnam. According to Fukaya, the center already hired 40 local engineers and this number will increase to 100 by 2013. The targeted headcount within the next five years is 500 employees.
Toshio Iwamoto, president and CEO of NTT Data, who was also at the media conference, said within the Asia-Pacific region, India is a very important market in the company's long-term growth plan. Specifically in Southeast Asia, Indonesia, Thailand, Vietnam, and Malaysia are also expected to see good growth and Myanmar will follow these countries, he added.
NTT Data operates in 23 cities across 9 countries within Asia-Pacific, excluding China which it operates as an individual market by itself. Iwamoto said Asia-Pacific has been a growth driver for the company, clocking the highest growth rate globally even though it is not the main contributor to overseas sales.
As NTT Data looks to break into the global top 5 IT service vendor ranks within the next 3 to 4 years--it is currently ranked sixth by Gartner--he estimated the U.S., Europe, China, and Asia-Pacific will together generate some 350 billion yen (US$4.24 billion) in sales, up from 220 billion yen (US$2.66 billion) this year.